Correlation Between Calvert High and Credit Suisse

Can any of the company-specific risk be diversified away by investing in both Calvert High and Credit Suisse at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Calvert High and Credit Suisse into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Calvert High Yield and Credit Suisse Multialternative, you can compare the effects of market volatilities on Calvert High and Credit Suisse and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Calvert High with a short position of Credit Suisse. Check out your portfolio center. Please also check ongoing floating volatility patterns of Calvert High and Credit Suisse.

Diversification Opportunities for Calvert High and Credit Suisse

0.62

Correlation Coefficient

Calvert High  Credit Suisse

Poor diversification

The 3 months correlation between Calvert and Credit is 0.62. Overlapping area represents the amount of risk that can be diversified away by holding Calvert High Yield and Credit Suisse Multialternative in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Credit Suisse Multia and Calvert High is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Calvert High Yield are associated (or correlated) with Credit Suisse. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Credit Suisse Multia has no effect on the direction of Calvert High i.e., Calvert High and Credit Suisse go up and down completely randomly.

Pair Corralation between Calvert High and Credit Suisse

Assuming the 90 days horizon Calvert High Yield is expected to generate 0.7 times more return on investment than Credit Suisse. However, Calvert High Yield is 1.44 times less risky than Credit Suisse. It trades about 0.11 of its potential returns per unit of risk. Credit Suisse Multialternative is currently generating about 0.02 per unit of risk. If you would invest  2,168  in Calvert High Yield on October 23, 2024 and sell it today you would earn a total of  315.00  from holding Calvert High Yield or generate 14.53% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	100.0%
Values	Daily Returns

Calvert High Yield  vs.  Credit Suisse Multialternative

Calvert High Yield

Risk-Adjusted Performance

10 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Calvert High Yield are ranked lower than 10 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong basic indicators, Calvert High is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Credit Suisse Multia

Risk-Adjusted Performance

11 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Credit Suisse Multialternative are ranked lower than 11 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong forward indicators, Credit Suisse is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Calvert High and Credit Suisse

The main advantage of trading using opposite Calvert High and Credit Suisse positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Calvert High position performs unexpectedly, Credit Suisse can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Credit Suisse will offset losses from the drop in Credit Suisse's long position.

The idea behind Calvert High Yield and Credit Suisse Multialternative pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.